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 Feds Reap Record Amount In Fraud-Fighting Efforts

​The federal government’s efforts to crack down on health care fraud garnered nearly $4.1 billion in recovered funds in fiscal year 2011, according to a report released today by the U.S. Department of Health and Human Services (HHS). Attorney General Eric Holder and HHS Secretary Kathleen Sebelius said in a statement that the monies recovered represent the “highest annual amount ever recovered from individuals and companies who attempted to defraud seniors and taxpayers or who sought payments to which they were not entitled.”

The program’s success would not have been possible without the Health Care Fraud Prevention & Enforcement Action Team (HEAT), created in 2009 to prevent fraud, waste, and abuse in the Medicare and Medicaid programs, the statement said.

According to an HHS fact sheet, in 2011, HEAT was responsible for the largest-ever fraud “takedown,” which involved 115 defendants in nine cities for their alleged participation in Medicare fraud schemes involving more than $240 million in false billing. 

In another takedown, prosecution teams charged 91 defendants in eight cities for their alleged participation in a Medicare fraud scheme involving more than $290 million in false billings.

A new fraud prevention system that uses “advanced predictive modeling technology” has been screening all Medicare fee-for-service claims before payment is made since June 30, 2011, according to the fact sheet. Similar to the predictive technologies used in the credit card industry, HHS’ system identifies suspicious behavior and billing irregularities.

In FY 2011, a record number of defendants (323) were charged with fraudulently billing the Medicare program more than $1 billion. Strike force teams secured 172 guilty pleas, convicted 26 defendants at trial, and sentenced 175 defendants to prison. The average prison sentence in strike force cases in FY 2011 was more than 47 months.

Federal prosecutors filed criminal charges against a total of 1,430 defendants for health care fraud-related crimes—the highest number charged in a single year in the department’s history, HHS said.

Approximately $2.4 billion of the recovered funds were obtained through civil health care fraud cases brought under the False Claims Act. Some of the cases included unlawful pricing by pharmaceutical manufacturers, illegal marketing of medical devices and pharmaceutical products for uses not approved by the Food and Drug Administration, Medicare fraud by hospitals and other institutional providers, and violations of laws against self-referrals and kickbacks.

The Affordable Care Act (ACA) is also credited with boosting the government’s arsenal of fraud-fighting weapons. The law provided an additional $350 million over 10 years to ramp up anti-fraud efforts, including increasing scrutiny of claims before they’ve been paid, investments in sophisticated data analytics, and an increased number of law enforcement agents and others to fight fraud in the health care system.

Among other things, the ACA authorizes the Centers for Medicare & Medicaid Services (CMS) to suspend Medicare payments to providers or suppliers during the investigation of a credible allegation of fraud. 

The report released today coincides with the announcement of a proposed rule from CMS aimed at recollecting overpayments in the Medicare program. The ACA calls for a specific time frame by which self-identified overpayments must be reported and returned.

The report can be found here, http://oig.hhs.gov/publications/hcfac.asp.

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